Government procurement contracts are renowned for their complexity, while procurement teams are under pressure to cut costs and do more with less. At Dreamforce last week, Salesforce ecosystem partner Apttus announced plans to come to their aid with AI-powered contract automation.

The quote-to-cash and contract lifecycle management (CLM) provider has teamed up with a public sector specialist to make its first foray into the government space. San Mateo-based Apttus is hooking up with Carahsoft Technology Corp, a Reston, VA-based top GSA Schedule and Solutions for Enterprise-Wide Procurement (SEWP, pronounced ‘soup’) contract holder.

The goal of the partnership is to help public sector organizations modernize traditionally cumbersome, manually intensive contract management and approval processes with their vendors. According to Kamal Ahluwalia, chief revenue officer of Apttus:

Contracts represent the basis for every commercial relationship driving an organization. By partnering with Carahsoft, we can help government organizations evolve from traditionally inefficient contract processes to smart, automated contract lifecycle management solutions that make government organizations run more quickly and intelligently.

AI and automation

Carahsoft is the largest government partner for the Salesforce ecosystem. It delivers SaaS solutions to Salesforce customers, serving as the master aggregator for many best-of-breed vendors, including IT manufacturers, resellers, systems integrators, and consulting partners. The partnership agreement enables Carahsoft to sell Apttus’ suite of Salesforce-native products to federal, state and local government agencies.

Industry veteran Ahluwalia says the partnership will help government organizations evolve inefficient contract management and approval processes by applying artificial intelligence and automation. The Apttus technology will help speed completion of traditionally manual tasks spanning the entire contract management lifecycle — from creation and approval of critical contracts to execution and eventual renewal. He explains:

The Apttus Intelligent Cloud is the first and only platform to combine end-to-end Quote-to-Cash business process automation with behavior applications and artificial intelligence (AI). Layered on top of our single data model is Max, our own in-house developed AI capability, which provides insights and conversational interface that enables users to easily interact with their Quote-to-Cash and CLM applications using natural language processing (NLP). Through Max, our platform delivers the assistance, coaching and prescriptive intelligence necessary to prompt users to take actions that generate successful business outcomes.

Public sector contracts

The potential fly in the ointment is that there are very different rules, regulatory requirements and statutes that that set parameters on government contracts. When two private entities create a contract, they are spending their own, or shareholders, money. Even if the contract turns out to be a bad one and the business or the shareholders lose money on the deal, the loss is a risk they took as part of investing or operating a business.

When the federal government enters into a contract, the money at stake comes from taxpayers who have not necessarily agreed to have their money invested in a particular project and have no legal recourse if the deal goes sour. Hence, there are more laws on government contracts to help ensure the federal government only enters into contracts that serve their citizens and makes the best use of tax dollars.

Government agencies also have to track metrics such as the percentage of work allocated to minority and women-owned businesses, adding further administrative burden that automation can help alleviate.

Government contracting

Ahluwalia says the Apttus intelligent contract management solution — with its built-in machine learning and AI engine — will make the more stringent government contracting requirements easier for vendors to navigate and meet.

Founded in 2006, San Mateo-based Apttus has grown steadily and now has more than 700 customers and 1200 employees around the globe. In 2016, the company signed more than 100 of the Fortune 500 as customers and managed over 16 million enterprise-level contracts.

My take

On paper this looks like a marriage made — if not in heaven — on a pretty high and promising cloud. Nobody needs good contract management help more than federal, state and local governments. The ability to automate the creation, approval, and renewal of the critical contracts that drive civic operations is an enormous need. This partnership gives Apttus an opportunity to get its solutions in front of a significant new audience of potential customers, aided by Carahsoft’s status as a major aggregator of Salesforce-based software solutions in this market.

The measure of success may depend on how well the Apttus management, sales and support staff adapt the experience and expertise the company has gained in the private sector to provide government vendors with business outcomes that help them overcome the notoriously sluggish bureaucracy and extra red tape of federal agencies.

In talking with Kamal Ahluwalia, I learned that Apttus is hot on the blockchain trail but that’s another story for another time.